January 22, 2026
Just last week, you would not have said so. That’s because the Fed received subpoenas from the Department of Justice over its building project. Fed Chairman Jerome Powell responded by releasing a video arguing that the legal topic was simply a pretext to pressure the Fed over interest rate policy.
But this week the Supreme Court will hear oral arguments over whether President Trump can remove Lisa Cook from the Fed Board over a mortgage fraud allegation. Trump will also soon nominate a replacement for Powell; last week he indicated Hassett would likely stay at the White House. Polymarket is now leaning toward Warsh.
Key Takeaway: There is a chance that perceived threats to Fed independence will decline if the Supreme Court rules against the White House and Trump nominates Warsh or Waller. Less uncertainty over Fed independence may help bolster the dollar but might also be a negative for assets that compete with the U.S. dollar, including precious metals and Bitcoin.
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